Rising pork and beef costs will continue to contribute to U.S. food inflation, which according to the U.S. Department of Agriculture will rise 3% to 4% in 2011, the most since 2008.
Pork prices may now rise 7.5%, increased 1% from March estimates. Beef estimates have been increased 2.5% from March, to 8%.
“I suspect when December arrives we will see increases of 4% to 6%” for the year in overall prices, said Bill Lapp, the president of agriculture-research company Advanced Economic Solutions. “The pressure on food prices is clearly on the upside." According to the Bureau of Labor Statistics, food costs rose 0.7% in March, capping a 2% gain for the first quarter of 2011.
Hog futures increased 25% for the year as of April 21, on rising export demand, while cattle futures were up 6.3%.